TPP: the initials may mean little to many outside the Pacific rim.
Yet the Trans-Pacific Partnership agreed on Monday will be the world’s biggest trade deal in 20 years – if it’s ratified by lawmakers in the countries concerned.
Not to be confused with the TTIP (“Tea-Tip”) which is about Transatlantic trade, the Trans-Pacific agreement aims to free up trade and harmonise standards across a huge area.
The 12 countries involved are Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore, Vietnam and the US. Together they embrace an area whose population (800 million) is almost double that of the EU’s single market, and whose economies amount to some 40 percent of world output.
But the big questions are: will the deal boost trade and cut red tape? Or is it a gift to big business and a threat to jobs?
“Some of the winners, clearly, are high technology industries, you look at semiconductors, computers, there are really some breakthrough provisions having to do with free flow of data and preventing countries from requiring local storage of data which is a big issue for the Googles of the world,” said Edward Alden, senior fellow at the US-based think tank the Council on Foreign Relations.
The US is in the vanguard of the deal’s supporters, who say the pact will help businesses and the economy by cutting tariffs. But the other countries such as Japan also see TPP as beneficial.
Critics argue TPP’s scope extends far beyond trade, and fear it will increase competition between different countries’ workforces, encourage relocation to low-wage nations – while increasing the clout of American know-how in certain sectors like pharmaceuticals – and tie governments’ hands in the face of corporations.
An array of protest movements challenge the pact’s legitimacy, believing it to be a secretive, sinister threat on several major issues – including employment rights, medicine, and intellectual property.
China – which has cautiously welcomed the TPP – is not included in the partnership; in fact some say a specific intention of the deal is to check Beijing’s power.
It certainly aims to tie Pacific trading partners closer to the US – although China signing up at a future date is seen as a possibility.